Xiaomi to Announce its “Change Rural Retail in India” Business Today

Mukul Yudhveer Singh

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Xiaomi may start its rural retail mission with budget smartphones, mobile phones powerbanks and LED TVs. The Mi team has been working on it for last few months

China based electronics brand Xiaomi is all set to launch a new business today which, according to the company, will change rural retail in India.

Manu Kumar Jain, vice president, Xiaomi Global, in a tweet posted, “Excited about a new business that we are launching. We’ll announce it tomorrow. This new business will forever change rural retail in India. Any guess? This amazing team has been working hard over last few months. Special mention to our fearless leader Sunil Baby.” He also posted a photo of the team that probably was working on the “rural retail business in India”.

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Sunil Baby, who got a special mention in Jain’s tweet also took on Twitter to post, “Impossible becomes Mipossible at Xiaomi India. The 3rd News coming tomorrow, stay tuned!”

We expect Xiaomi to start its rural retail mission with budget smartphones, mobile phones power banks, and LED TVs. Mi smartphones and LED TVs have successfully penetrated the market in India and will definitely help the brand in covering the rural market.

What’s interesting here is the fact that how a Eight years young brand is taking on the rural market in India in such a planned way. Many other brands, despite their presence in the country for decades, have not made fair attempts to capture the rural markets.

Rural India a big market for mobile phones, appliances and consumer electronics

Indian consumer durable industry analysis published by the India Brand Equity Foundation (Ibef) has pointed out that electronic appliances consumption in rural areas is expected to grow as penetration of brands increases. The analysis posted on the IBEF website said, “Overall consumer durable exports reached US$ 0.78 billion in 2017. Also demand for durables like refrigerators as well as consumer electronic goods are likely to witness growing demand in the coming years in the rural markets as the government plans to invest significantly in rural electrification. The S&P BSE Consumer Durables Index has grown at 20 per cent CAGR in 2010-17.”

It is worth mentioning here that the government, in budget 2018-19, had retained focus on rural economy via continuation of the pro-poor and pro-farmer schemes.

Moreover, many e-commerce portals do not deliver in rural areas which further weakens a brand’s desire of penetrating the market. But we might see a big change soon as the electrification of rural areas take place.

Vicinity to Tier 2 and Tier 3 cities may help

Appliances and consumer electronic brands that have already penetrated the Tier 2 and Tier 3 cities will have a big advantage in establishing consumer trust in rural markets. These will also find it easy to establish warehouses and sale points because of their network of distributors and retailers present in the area.

A lot of villages in rural India are located on the outskirts of Tier 2 and Tier 3 cities, which will prove to be an advantage to electronic brands.

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